During recessions of the past, when work for architects dried up, one place they could reliably find projects was with institutions and governments. But with the AIA’s Architecture Billings Index registering the lowest levels of institutional work in two decades, even this safe haven is proving vulnerable. For proof, look no further than New York City’s School Construction Authority (SCA).

On November 5, the authority—a division of the city’s Department of Education—released its latest capital budget, which calls for a drastic reduction in the number of new schools and classrooms to be built or renovated over the next five years. It could not have come at a worse time: While the real estate bubble may finally have burst in the city, school demand remains higher than ever, creating crowded classrooms and considerable commutes for students throughout the five boroughs.

The new plan proposes to spend $11.3 billion to create 25,000 new seats in 42 new schools. Though the budget has only shrunk by $1.8 billion relative to the 2005–2009 version, it also called for the construction of 66,000 seats in 76 schools, a reduction of nearly two-thirds. Margie Feinberg, a spokesperson for the authority, said that because the current plan includes 8,000 seats held over from the last one, the difference is closer to half as many seats being built. Some critics say it is the other way around. “If you count the seats rolled over from the last plan, this means that the city proposes creating only 17,000 new seats, compared to 66,000 when the last plan was introduced,” Leonie Haimson, executive director of Class Size Matters, told The New York Times.

From the outset, though, the capital plan presents a sober, even dispiriting outlook. In its first paragraph, the plan states that the Department of Education “recognizes that New York City and America are going through a period of economic distress. We cannot afford to continue spending at the same levels as in recent years, when we undertook the largest capital program in our city’s history.”

Feinberg said that despite such setbacks, the authority is still committed to promoting the highest levels of design quality throughout the city’s schools. She emphasized the department’s new Green Construction Guidelines, which were passed last year and seek LEED-certification on all new schools, as one way the authority will not only maintain its design standards but also save money for the department in the long run. “We will not be cutting corners,” Feinberg said. While the authority does not expect material costs or labor to fall by much, land acquisition should become more affordable.

Daniel Heuberger, a principal at Dattner Architects who has designed a number of schools for the city, said that the authority should be applauded for its responsiveness to economic realities, both now and in the past. “I will say that the last capital cycle for the SCA was a particularly ambitious one,” he said. “So what we’re looking at now is only a slowdown in relative terms.”